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Crude Oil, Gasoline, and Diesel Prices on the Uptrend Last Week (Part 2 of 4) (Continued from Part 1) WTI and Brent
WTI’s (West Texas Intermediate) discount to Brent widened last week compared to the week before. The differential as of Friday, April 24, was $8.19 compared to $6.17 on Friday, April 17.
Both the benchmarks saw support from speculation that US crude output was easing, Brent also saw increased support from the crisis in Yemen.
WTI and Brent have been volatile in the past months. It had significantly converged since February when the differential widened to ~$12. It hit levels near $3 in the week ended April 17. It widened back to levels near $8 last Friday, April 24. To put this into perspective, in January, WTI and Brent were trading near parity. This shows how volatile global oil markets have been over the last few months.
A wider WTI spread is a negative for US producers such as Chevron Corporation (CVX), Apache Corporation (APA), Marathon Oil (MRO), and Pioneer Natural Resources (PXD). A wider spread generally means that US producers receive comparatively less money for their crude output compared to their international counterparts.
All these companies are components of the iShares Global Energy ETF (IXC) and make up ~10.5% of the ETF.
However, US refiners such as Valero Energy (VLO) benefit from a wider WTI spread since they have access to cheaper crude oil than refiners do elsewhere. These companies also get international prices that are benchmarked to Brent crude for their refined products, which don’t have export impositions. So a wider spread enhances their profitability.
Continue to Part 3 Browse this series on Market Realist:
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Marathon Oil Corporation
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CODE : MRO |
ISIN : US5658491064 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Marathon Oil is a oil exploration company based in United states of america. Marathon Oil is listed in United States of America. Its market capitalisation is US$ 23.7 billions as of today (€ 21.3 billions). Its stock quote reached its lowest recent point on August 13, 1982 at US$ 0.70, and its highest recent level on September 19, 2024 at US$ 27.89. Marathon Oil has 849 755 866 shares outstanding. |